To be honest, I still am lost in the format jungle and still don't know what the advantage of ePub file over, say, PDF format.

Briefly, simply:

PDF is designed as a print-ready format: what you see on the page is what prints out. That means it's set to a page size when created--and that page size is almost never 3.5" x 4.5" to fit on a 6" reader's screen. Most commonly, publisher's PDFs are about 6 x 9, and individuals' PDFs are letter or A4 size, which are very tiny indeed when displayed on an ebook reader.

PDFs can look very good when displayed on the right size screen. However, on the wrong screen, they look awful. And a lot of publishers don't bother putting in the extra parts that make ebooks work well--a table of contents, the title/author info in the right places, and so on.

EPub is based on HTML. (It is HTML, in an "ePub wrapper"--zipped up with some bits that tell the reader program how to display it.) That means there's no fixed size or shape to it; it fits whatever screen it's shown in. If you increase the size of the text, it just wraps to fit the screen again.

The other info ("metadata")--title, author, contents, and so on--are much easier to set in an ePub file, because they're done with HTML, and anyone (or any program) that knows how to do the formatting at all, can also add those elements. EPub is read on more readers than PDF. And it can be read on very tiny screens, like iPods or PDAs; PDFs are very troublesome on those screens.

Even more briefly: PDF can look nicer. EPub is more practical.

There are other differences, but those start to get technical and perhaps obscure.